On this page of StockholderLetter.com we present the latest annual shareholder letter from Drilling Tools International Corp — ticker symbol DTI. Reading current and past DTI letters to shareholders can bring important insights into the investment thesis.

 •  4/2/2025 Letter Continued (Full PDF)
 •  4/2/2024 DTI Stockholder Letter
 •  More "Oil & Gas Equipment & Services" Category Stockholder Letters
 •  DTI Benford's Law Stock Score = 86

DTI Shareholder/Stockholder Letter Transcript:

Driving Innovation. Delivering Excellence.
ADVANCING THE ENERGY LANDSCAPE
2024 ANNUAL REPORT

ACQUISITION STRATEGY UPDATE
Drilling Tools International Corp. (Nasdaq: DTI) has pursued an aggressive acquisition strategy throughout 2024 and early 2025,
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Superior Drilling Products, Inc. (SDP) for $32.2 million in August 2024, integrating SDP's patented Drill-N-Ream   technology
and manufacturing expertise.
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European Drilling Projects (EDP) in October 2024, strengthening DTI's presence in the Eastern Hemisphere.
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African markets.
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capabilities, particularly in downhole drilling tools and wellbore conditioning technologies.
343%
63K+
Revenue grew by 343%
from $35 million in 2012
to $155 million in 2024
75%
27
Over 63,000 rental tools
and drilling equipment in
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Since 2013, DTI has improved its
Total Recordable Incident Rate by 75%,
resulting in a rate of 1.15 for 2024
DTI operates from 16 locations in
North America and maintains
11 international service and support
centers in Europe, Middle East, and
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ADJUSTED FREE CASH FLOW
REVENUE
(in Millions)
(in Millions)
$154.5
$17.2
$16.5
TOTAL RECORDABLE
INCIDENT RATE (TRIR)(2)
1.21
1.23
$152.0
1.15
$129.6
$7.3
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(2) US locations.

DEAR FELLOW STOCKHOLDERS
   2024 was a transformative and pivotal year for Drilling Tools
International (DTI).   
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achievements underscore our resilience, commitment to growth,
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   We delivered impressive Adjusted Free Cash Flow of $17.2 million,
representing a remarkable 136% year-over-year growth.   
M&A UPDATE
We are pleased with the integration progress of these acquisitions,
which have already started to contribute to our growth. The
integration of Superior Drilling Products has provided us with
valuable vertical and horizontal integration synergies, including cost
savings and margin improvements. We are on track to achieve 100%
of the $4.5 million in previously announced SDPI synergies by
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initial targets.
Our Deep Casing group has deployed innovative tools like the
MechLok Swivel and Rubblizer, which are gaining traction globally.
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   Revenue Growth: We achieved consolidated revenue of $154.4
million, with tool rental revenues of $117.9 million and product
sales of $36.5 million. This growth was driven by strategic
acquisitions and organic initiatives, particularly the successful
integration of Deep Casing Tools and Superior Drilling Products.
This performance is especially noteworthy given the 5% global
rig count decline over the same period.
Our acquisition of European Drilling Projects added innovations such
as the Fixed Blade product line of drilling stabilization technology
and Dome Hybrid Reamer products that are steadily gaining traction
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Titan Tools further strengthens our distribution and rental footprint
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Eastern Hemisphere.
   3UR  WDELOLW\  We generated adjusted EBITDA(1) of $40.1 million
(1)
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Our adjusted diluted EPS(1) for 2024 was 31 cents per share, a
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impressive Adjusted Free Cash Flow of $17.2 million,
representing a remarkable 136% year-over-year growth.
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This innovative tool has been instrumental in expanding our
customer base and enhancing our market position. Our customers
consider RotoSteer a valuable option for complex drilling operations.
This proprietary technology underscores our focus on creating
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value, and is gaining steady commercial traction in the US land
market.
   Strategic Acquisitions: We completed the acquisitions of
Deep Casing Tools, Superior Drilling Products, and European
Drilling Projects during the year, and closed on Titan Tools
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expanded our technological capabilities and global footprint,
particularly in the Middle East and Europe, positioning us for
long-term success. DTI's expansion into the Eastern Hemisphere
was a strategic move that has already begun to pay dividends,
with international revenue contribution growing from less than
1% in 2023 to approximately 8% in 2024.
   We completed the acquisitions of Deep Casing Tools, Superior
Drilling Products, and European Drilling Projects during the year, and
closed on Titan Tools Services in early 2025. These acquisitions have
significantly expanded our technological capabilities and global
footprint, particularly in the Middle East and Europe, positioning us
for long-term success.    
DRILLING TOOLS INTERNATIONAL
2024 ANNUAL REPORT
OPERATIONAL OUTLOOK
DTI remains a market leader in providing downhole tool rentals for
both North American land and Gulf of America deepwater drilling
operations. We have maintained a strong presence on more than
50% of working locations in North America, a testament to our
operational excellence and the trust our customers place in us.
Our operational expertise, technologically advanced asset base, and
extensive geographic reach allow us to be the product and solutions
provider of choice for E&P operators and service companies
worldwide.
Our safety performance in 2024 was outstanding, with a Total
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improvement year over year. We are proud of this accomplishment
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healthy workplace for everyone.
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LIQUIDITY AND CASH
We ended 2024 with approximately $6.2 million in cash and cash
equivalents and a net debt of $47.6 million. Our improved liquidity
position, including the expansion of our ABL Credit Facility from $60
million to $80 million and the addition of a $25 million term loan,
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initiatives and execute on our M&A strategy.
LOOKING TO THE FUTURE
We are optimistic about the medium- to long-term natural gas
demand outlook, particularly with new LNG capacity coming online
in 2025 and 2026. DTI is well-positioned to capitalize on these trends
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expected to grow to $163-183 million and Adjusted EBITDA to
$40-50 million.
We believe that our M&A framework will continue to drive growth
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focus on acquiring high-quality companies at attractive multiples
positions us for success in the next growth cycle. We have a solid
M&A process and robust pipeline that will allow us to consolidate
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strategically. This approach, combined with our organic growth
drivers and expanded product portfolio, creates a compelling
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   We have demonstrated our ability to execute our strategic plan,
deliver improved results, and generate significant free cash flow
throughout the cycle.   
In closing, I would like to express my sincere gratitude to our
exceptional team of DTI employees and to our investors for their
continued support. We have demonstrated our ability to execute
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delivering value to our stockholders through innovation, safety, and
customer service.
Thank you for your continued support and trust in DTI.
R. Wayne Prejean
President and Chief Executive O  cer
April 2, 2025
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2024 ANNUAL REPORT
DRILLING TOOLS INTERNATIONAL



 4/2/2025 Letter Continued (Full PDF)